Weakness of the Confederation

The years of the Confederation were years in which the states found it difficult to deal with the massive debt incurred by the Revolutionary War. The taxing of goods moving between states made trade difficult, causing ill feelings between states that was only made worse by ongoing disputes between the states over boundaries.

The Articles of Confederation had established a weak central government comprising a Congress with no real executive. While Congress appointed individuals, such as John Jay (Secretary of State) and Robert Morris (Secretary of Treasury), to handle some executive duties, there was no central executive mechanism. To make matters worse, any decision required the approval of all the states. Thus, any one state could veto any proposal. This was particularly problematic when it came to raising revenue, which the Confederation had no means of doing other than requesting money from the states. All attempts to give the Confederation the power to raise money by levying a customs duty came to nothing.
The central government's weakness also limited the Confederation's ability to reach satisfactory agreements with foreign governments. American diplomats made trade agreements with several European countries, such as France, Sweden, and Prussia. Nevertheless, the Confederation could not reach any agreements with Great Britain and Spain, two nations with which the US had serious border disagreements. The one major success during the period was the passage of the Northwest Ordinance (1787), which ended the competing state claims for western territory and provided a framework for settling the territory.

Powers of the Confederation

1) Declaring War
2) Raising an Army and Navy
3) Making Treaties
4) Borrowing Money
5) Establishing a Postal System
6)Conducting Business with Native Americans and other powers

Powers that the Confederation Did Not Have

No authority of individual citizens
No means of enforcing laws
No court system
No ability to tax
Dependent on States to send money

Economic Downturn

With the war over and no strong central government in place, the United States suffered from a strong economic downturn. There were several causes of the downturn—the first was a lack of a strong central currency. The Continental Congress had printed paper money to pay for the war. With no gold behind the money and little money given by the states, the paper money became valueless. Individual states began printing money. However, it was almost impossible to compare the value of paper money from one state to the other. Finally, some states started taxing goods coming into the state from another state. All of this made trade nearly impossible and caused the economy to nearly collapse